2006 Nebraska Revised Statutes - § 44-1605 — Life insurance; policy issued to trustees of a fund; requirements.

Section 44-1605
Life insurance; policy issued to trustees of a fund; requirements.

A policy issued to the trustees of a fund established by two or more employers or by one or more labor unions, or by one or more employers and one or more labor unions, which trustees shall be deemed the policyholder, to insure employees of the employers or members of the unions for the benefit of persons other than the employers or the unions shall be subject to the following requirements:

(1) The persons eligible for insurance shall be all of the employees of the employers or all of the members of the unions, or all of any class or classes thereof determined by conditions pertaining to their employment, or to membership in the unions, or to both. The policy may provide that the term employees shall include retired employees and the individual proprietor, partners, or members if an employer is an individual proprietor, partnership, or limited liability company. No director of a corporate employer shall be eligible for insurance under the policy unless such person is otherwise eligible as a bona fide employee of the corporation by performing services other than the usual duties of a director. No individual proprietor, partner, or member shall be eligible for insurance under the policy unless he or she is actively engaged in and devotes a substantial part of his or her time to the conduct of the business of the proprietorship, partnership, or limited liability company. The policy may provide that the term employees shall include the trustees or their employees, or both, if their duties are principally connected with such trusteeship;

(2) The premium for the policy shall be paid by the trustees wholly from funds contributed by the employer or employers of the insured persons, or by the union or unions, or by both. No policy may be issued on which any part of the premium is to be derived from funds contributed by the insured persons specifically for their insurance. The policy shall insure all eligible persons or all except any as to whom evidence of individual insurability is not satisfactory to the insurer;

(3) The policy shall cover at date of issue at least fifty persons and not less than an average of three persons per employer unit. If the fund is established by the members of an association of employers, the policy may be issued only if (a) either the participating employers constitute at the date of issue at least sixty percent of those employer members whose employees are not already covered for group life insurance or the total number of persons covered at date of issue exceeds six hundred and (b) the policy shall not require that, if a participating employer discontinues membership in the association, the insurance of his or her employees shall cease solely by reason of such discontinuance; and

(4) The amount of insurance under the policy shall be based upon some plan precluding individual selection either by the insured persons or by the policyholder, employers, or unions.

Source:

Laws 1949, c. 150, § 1(4), p. 380

Laws 1957, c. 192, § 4, p. 674

Laws 1969, c. 376, § 1, p. 1336

Laws 1989, LB 92, § 176

Laws 1993, LB 121, § 235

~Reissue Revised Statutes of Nebraska